Release Details

EZCORP Reports Second Quarter Fiscal 2024 Results

May 01, 2024

Record Q2 Revenues Driving Strong Earnings Growth

AUSTIN, Texas, May 01, 2024 (GLOBE NEWSWIRE) --  EZCORP, Inc. (NASDAQ: EZPW), a leading provider of pawn transactions in the United States and Latin America, today announced results for its second quarter ended March 31, 2024.

Unless otherwise noted, all amounts in this release are in conformity with U.S. generally accepted accounting principles (“GAAP”) and comparisons shown are to the same period in the prior year.

SECOND QUARTER HIGHLIGHTS

  • Net income of $21.5 million, up from a net loss of $6.8 million. In the prior-year we recorded our share of the one-time, non-cash goodwill impairment and discrete adjustments recognized by Cash Converters International of $25.6 million. On an adjusted basis1, net income increased $3.6 million or 21%.
  • Diluted earnings per share of $0.29, up from diluted loss per share of $0.12. On an adjusted basis, diluted earnings per share of $0.28, compared to $0.23.
  • Total revenues increased 11%, and gross profit increased 12%.
  • Merchandise sales gross margin remains within our targeted range at 35%.
  • Pawn loans outstanding (PLO) up 14% to $235.8 million.
  • Return on earning assets (ROEA) remains strong at 165%.

CEO COMMENTARY AND OUTLOOK

Lachie Given, Chief Executive Officer, stated, “We achieved record second quarter revenue and PLO, driven by strong consumer demand and excellent customer service. The challenging macro-economic environment continues to fuel robust customer demand for short-term cash and pre-owned and recycled goods.

“During the second quarter, we opened nine de novo stores in Latin America and acquired six stores in the U.S. We also consolidated six stores, five in Latin America and one in the U.S., which netted an additional nine stores. We now have a total of 1,246 stores across the organization and over 7,800 team members. Our strong balance sheet allows us to continue to build scale, both organically and by acquiring new stores. In addition, we continue to return capital to our shareholders, having repurchased $3.0 million worth of EZCORP shares during the quarter.

“We have 4.6 million EZ+ Rewards members, an increase of 61% over the second quarter of 2023 and 10% over last quarter. Online payments continue to gain traction with customers, and we collected $21.8 million in the U.S., up 72%, and have expanded online payments to our stores in Mexico. These initiatives to increase customer loyalty and engagement and provide a more convenient customer experience are an integral part of our growth in the local neighborhoods in which we operate.

“Thank you to our exceptional EZCORP team members for delivering another outstanding quarter of excellent operating and financial results for our shareholders. We will continue to invest in our team and our stores, focusing on recruitment and retention, while also investing in technology and other initiatives to enhance the customer experience. This focus and investment continues to enhance value for all of our shareholders,” concluded Given.

CONSOLIDATED RESULTS

Three Months Ended March 31 As Reported   Adjusted1
in millions, except per share amounts   2024     2023       2024     2023
               
Total revenues $ 285.6   $ 258.4     $ 280.2   $ 258.4
Gross profit $ 167.6   $ 149.2     $ 164.6   $ 149.2
Income (loss) before tax $ 28.7   $ (7.3 )   $ 27.6   $ 24.3
Net income (loss) $ 21.5   $ (6.8 )   $ 20.7   $ 17.1
Diluted earnings (loss) per share $ 0.29   $ (0.12 )   $ 0.28   $ 0.23
EBITDA (non-GAAP measure) $ 37.4     $ 2.1     $ 36.2   $ 33.8
  • Diluted earnings per share of $0.29, up from diluted loss per share of $0.12. On an adjusted basis, diluted earnings per share of $0.28, up from $0.23. The primary difference between GAAP and Adjusted financial results is attributable to our share of the previously announced prior year one-time, non-cash goodwill impairment recognized by Cash Converters International.
  • Income before taxes was $28.7 million, up from loss before taxes of $7.3 million, and adjusted EBITDA increased 7% to $36.2 million.
  • PLO increased 14% to $235.8 million, up $29.7 million. On a same-store basis2, PLO increased 12% due to improved operational performance and continued strong pawn demand.
  • Total revenues increased 11%, and gross profit increased 12%, reflecting improved pawn service charge (PSC) revenues, merchandise sales and merchandise sales gross profit.
  • PSC increased 15% as a result of higher average PLO.
  • Merchandise sales gross margin remains within our target range at 35%. Aged general merchandise was 2.3% of total general merchandise inventory.
  • Net inventory increased 9%, as expected with the growth in PLO. Inventory turnover increased to 2.9x, from 2.8x.
  • Store expenses increased 13%, primarily due to increased labor, in-line with store activity, higher store count and, to a lesser extent, expenses related to our loyalty program. On a same-store basis, store expenses increased 11%.
  • General and administrative expenses increased 17%, primarily due to labor driven by incentive compensation related to an increase in share price and, to a lesser extent, costs related to the implementation of Workday.
  • Cash and cash equivalents at the end of the quarter was $229.1 million, down 6% year-over-year. The decrease was due to the increase in PLO and inventory, strategic investments, share repurchases, and the acquisition of new stores, partially offset by cash inflows provided by operating activities.

SEGMENT RESULTS

U.S. Pawn

  • PLO ended the quarter at $173.7 million, up 11% or 9% on a same store basis.
  • Total revenue and gross profit was up 10%, reflecting increased PSC and higher merchandise sales.
  • PSC increased 14% as a result of higher average PLO.
  • Merchandise sales increased 6%, and gross margin decreased to 37% from 38%. Aged general merchandise increased to 3.0% of total general merchandise inventory, primarily driven by luxury handbags in our Max Pawn stores.
  • Net inventory increased 9%, as expected with the growth in PLO. Inventory turnover remained flat at 2.6x.
  • Store expenses increased 12%, primarily due to salaries and benefits as we continue to support our team members as a part of People, Pawn and Passion focus, higher store count and, to a lesser extent, expenses related to our loyalty program.
  • Segment contribution increased 8% to $40.7 million.
  • During the quarter, net store count increased by five due to the acquisition of six stores and the consolidation of one store.
     

Latin America Pawn

  • PLO improved to $62.0 million, up 26% (19% on constant currency basis). On a same store basis, PLO increased 22% (15% on a constant currency basis) due to improved operational performance and continued strong pawn demand.
  • Total revenues was up 12% (4% on constant currency basis), and gross profit increased 18% (10% on a constant currency basis), reflecting increased PSC, higher merchandise sales and improved merchandise sales gross profit.
  • PSC increased 18% (10% on a constant currency basis) as a result of higher average PLO.
  • Merchandise sales gross margin increased to 33% from 32%. Aged general merchandise was 1.4% of total merchandise inventory.
  • Net inventory increased 9% (2% on a constant currency basis). Inventory turnover increased to 3.6x from 3.5x.
  • Store expenses increased 15% (7% on a constant currency basis), primarily due to higher store count. Same-store expenses increased 10% (2% on a constant currency basis).
  • Segment contribution increased 2% (decreased 3% on a constant currency basis). On an adjusted basis, segment contribution was up 38% to $7.7 million, with the primary adjustment being the prior year reversal of contingent consideration liability of $2.5 million in connection with a previously completed acquisition.
  • During the quarter, net store count increased by four due to the opening of nine de novo stores and the consolidation of five stores.

FORM 10-Q

EZCORP’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2024 has been filed with the Securities and Exchange Commission. The report is available in the Investor Relations section of the Company’s website at http://investors.ezcorp.com.

CONFERENCE CALL
EZCORP will host a conference call on Thursday, May 2, 2024, at 8:00 am Central Time to discuss Second Quarter Fiscal 2024 results. Analysts and institutional investors may participate on the conference call by registering online at: https://register.vevent.com/register/BIc16d26b733bc44b7aecc33d2d530fef4. Once registered you will receive the dial-in details with a unique PIN to join the call. The conference call will be webcast simultaneously to the public through this link: http://investors.ezcorp.com. A replay of the conference call will be available online at http://investors.ezcorp.com shortly after the end of the call. 

ABOUT EZCORP

Formed in 1989, EZCORP has grown into a leading provider of pawn transactions in the United States and Latin America. We also sell pre-owned and recycled merchandise, primarily collateral forfeited from pawn lending operations and merchandise purchased from customers. We are dedicated to satisfying the short-term cash needs of consumers who are both cash and credit constrained, focusing on an industry-leading customer experience. EZCORP is traded on NASDAQ under the symbol EZPW and is a member of the S&P 1000 Index and Nasdaq Composite Index. 

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FORWARD LOOKING STATEMENTS

This announcement contains certain forward-looking statements regarding the Company’s strategy, initiatives and expected performance. These statements are based on the Company’s current expectations as to the outcome and timing of future events. All statements, other than statements of historical facts, including all statements regarding the Company's strategy, initiatives and future performance, that address activities or results that the Company plans, expects, believes, projects, estimates or anticipates, will, should or may occur in the future, including future financial or operating results, are forward-looking statements. Actual results for future periods may differ materially from those expressed or implied by these forward-looking statements due to a number of uncertainties and other factors, including operating risks, liquidity risks, legislative or regulatory developments, market factors, current or future litigation and risks associated with the COVID-19 pandemic. For a discussion of these and other factors affecting the Company’s business and prospects, see the Company’s annual, quarterly and other reports filed with the Securities and Exchange Commission. The Company undertakes no obligation to update or revise forward-looking statements to reflect changed assumptions, the occurrence of unanticipated events or changes to future operating results over time.

Contact:
Email: Investor_Relations@ezcorp.com
Phone: (512) 314-2220

 

EZCORP, Inc.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
 
  Three Months Ended
March 31,
  Six Months Ended
March 31,
(in thousands, except per share amounts)   2024       2023       2024       2023  
Revenues:              
Merchandise sales $ 164,687     $ 152,507     $ 344,090     $ 316,294  
Jewelry scrapping sales   13,714       12,825       27,796       20,709  
Pawn service charges   107,163       93,030       213,612       185,623  
Other revenues   75       61       132       124  
Total revenues   285,639       258,423       585,630       522,750  
Merchandise cost of goods sold   106,259       97,339       221,469       202,216  
Jewelry scrapping cost of goods sold   11,788       11,902       23,996       18,855  
Gross profit   167,592       149,182       340,165       301,679  
Operating expenses:              
Store expenses   114,582       101,269       225,137       202,072  
General and administrative   18,266       15,609       34,809       31,085  
Depreciation and amortization   8,219       7,963       16,784       15,951  
Loss (gain) on sale or disposal of assets and other   3       73       (169 )     57  
Other income   (765 )     (2,465 )     (765 )     (2,465 )
Total operating expenses   140,305       122,449       275,796       246,700  
Operating income   27,287       26,733       64,369       54,979  
Interest expense   3,402       3,390       6,842       9,580  
Interest income   (2,882 )     (1,898 )     (5,521 )     (2,562 )
Equity in net (income) loss of unconsolidated affiliates   (1,719 )     32,501       (2,872 )     30,917  
Other (income) expense   (165 )     80       (436 )     (154 )
Income (loss) before income taxes   28,651       (7,340 )     66,356       17,198  
Income tax expense (benefit)   7,172       (550 )     16,407       7,210  
Net income (loss) $ 21,479     $ (6,790 )   $ 49,949     $ 9,988  
               
Basic earnings (loss) per share $ 0.39     $ (0.12 )   $ 0.91     $ 0.18  
Diluted earnings (loss) per share $ 0.29     $ (0.12 )   $ 0.65     $ 0.11  
               
Weighted-average basic shares outstanding   55,093       55,648       55,084       55,981  
Weighted-average diluted shares outstanding   83,045       55,648       84,948       65,269  

 

EZCORP, Inc.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)

 
(in thousands, except share and per share amounts) March 31,
2024
  March 31,
2023
  September 30,
2023
           
Assets:          
Current assets:          
Cash and cash equivalents $ 229,111     $ 243,128     $ 220,595  
Restricted cash   8,581       8,451       8,373  
Pawn loans   235,773       206,096       245,766  
Pawn service charges receivable, net   38,268       33,116       38,885  
Inventory, net   163,429       150,297       166,477  
Prepaid expenses and other current assets   47,142       45,564       39,623  
Total current assets   722,304       686,652       719,719  
Investments in unconsolidated affiliates   13,162       10,681       10,987  
Other investments   51,220       39,220       36,220  
Property and equipment, net   63,306       59,775       68,096  
Right-of-use assets, net   243,752       234,287       234,388  
Goodwill   310,658       300,078       302,372  
Intangible assets, net   61,714       59,620       58,216  
Notes receivable, net         1,233        
Deferred tax asset, net   26,247       19,127       25,702  
Other assets, net   15,779       9,859       12,011  
Total assets $ 1,508,142     $ 1,420,532     $ 1,467,711  
           
Liabilities and equity:          
Current liabilities:          
Current maturities of long-term debt, net $ 34,347     $     $ 34,265  
Accounts payable, accrued expenses and other current liabilities   62,838       72,695     $ 81,605  
Customer layaway deposits   20,352       18,761       18,920  
Operating lease liabilities, current   55,658       53,921       57,182  
Total current liabilities   173,195       145,377       191,972  
Long-term debt, net   326,573       359,287       325,847  
Deferred tax liability, net   465       368       435  
Operating lease liabilities   197,285       191,874       193,187  
Other long-term liabilities   10,228       11,038       10,502  
Total liabilities   707,746       707,944       721,943  
Commitments and contingencies (Note 9)          
Stockholders’ equity:          
Class A Non-voting Common Stock, par value $0.01 per share; shares authorized: 100 million; issued and outstanding : 52,057,309 as of March 31, 2024; 52,561,071 as of March 31, 2023; and 51,869,569 as of September 30, 2023   521       526       519  
Class B Voting Common Stock, convertible, par value $0.01 per share; shares authorized: 3 million; issued and outstanding: 2,970,171   30       30       30  
Additional paid-in capital   345,174       343,088       346,181  
Retained earnings   477,683       405,961       431,140  
Accumulated other comprehensive loss   (23,012 )     (37,017 )     (32,102 )
Total equity   800,396       712,588       745,768  
Total liabilities and equity $ 1,508,142     $ 1,420,532     $ 1,467,711  

 

EZCORP, Inc.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)

 
  Six Months Ended
March 31,
(in thousands)   2024       2023  
   
Operating activities:      
Net income $ 49,949     $ 9,988  
Adjustments to reconcile net income to net cash flows from operating activities:      
Depreciation and amortization   16,784       15,951  
Amortization of debt discount and deferred financing costs   807       736  
Non-cash lease expense   29,514       27,546  
Deferred income taxes   515       (6,987 )
Other adjustments   (1,429 )     (2,386 )
Provision for inventory reserve   183       280  
Stock compensation expense   4,844       3,741  
Equity in net (income) loss from investment in unconsolidated affiliates   (2,872 )     30,917  
Net loss on extinguishment of debt         3,545  
Changes in operating assets and liabilities, net of business acquisitions:      
Pawn service charges receivable   1,071       1,357  
Inventory   1,617       (2,306 )
Prepaid expenses, other current assets and other assets   (8,699 )     (3,639 )
Accounts payable, accrued expenses and other liabilities   (57,531 )     (43,969 )
Customer layaway deposits   886       1,426  
Income taxes   909       8,852  
Dividends from unconsolidated affiliates         1,775  
Net cash provided by operating activities   36,548       46,827  
Investing activities:      
Loans made   (433,194 )     (378,717 )
Loans repaid   262,970       230,604  
Recovery of pawn loan principal through sale of forfeited collateral   188,351       171,504  
Capital expenditures, net   (13,654 )     (18,439 )
Acquisitions, net of cash acquired   (8,610 )     (12,968 )
Issuance of notes receivable         (15,500 )
Investment in unconsolidated affiliate   (850 )     (2,133 )
Investment in other investments   (15,000 )     (15,000 )
Dividends from unconsolidated affiliates   1,745        
Net cash used in investing activities   (18,242 )     (40,649 )
Financing activities:      
Taxes paid related to net share settlement of equity awards   (3,253 )     (1,149 )
Proceeds from issuance of debt         230,000  
Debt issuance cost         (7,458 )
Cash paid on extinguishment of debt         (1,951 )
Payments on debt         (178,488 )
Purchase and retirement of treasury stock   (6,010 )     (10,978 )
Payments of finance leases   (276 )      
Net cash (used in) provided by financing activities   (9,539 )     29,976  
Effect of exchange rate changes on cash and cash equivalents and restricted cash   (43 )     1,056  
Net increase in cash, cash equivalents and restricted cash   8,724       37,210  
Cash and cash equivalents and restricted cash at beginning of period   228,968       214,369  
Cash and cash equivalents and restricted cash at end of period $ 237,692     $ 251,579  
       

                                                                                                                                

 

EZCORP, Inc.
OPERATING SEGMENT RESULTS
   
  Three Months Ended March 31, 2024
(Unaudited)
(in thousands) U.S. Pawn   Latin America Pawn   Other Investments   Total Segments   Corporate Items   Consolidated
                       
Revenues:                      
Merchandise sales $ 114,849     $ 49,838     $     $ 164,687     $     $ 164,687  
Jewelry scrapping sales   12,686       1,028             13,714             13,714  
Pawn service charges   80,010       27,153             107,163             107,163  
Other revenues   29       15       31       75             75  
Total revenues   207,574       78,034       31       285,639             285,639  
Merchandise cost of goods sold   72,798       33,461             106,259             106,259  
Jewelry scrapping cost of goods sold   10,794       994             11,788             11,788  
Gross profit   123,982       43,579       31       167,592             167,592  
Segment and corporate expenses (income):                      
Store expenses   80,840       33,742             114,582             114,582  
General and administrative                           18,266       18,266  
Depreciation and amortization   2,516       2,392             4,908       3,311       8,219  
(Gain) loss on sale or disposal of assets and other   (30 )     (66 )           (96 )     99       3  
Other income                           (765 )     (765 )
Interest expense                           3,402       3,402  
Interest income         (608 )     (633 )     (1,241 )     (1,641 )     (2,882 )
Equity in net income of unconsolidated affiliates               (1,719 )     (1,719 )           (1,719 )
Other expense (income)         1       14       15       (180 )     (165 )
Segment contribution $ 40,656     $ 8,118     $ 2,369     $ 51,143          
Income (loss) before income taxes             $ 51,143     $ (22,492 )   $ 28,651  

        

  Three Months Ended March 31, 2023
(Unaudited)
(in thousands) U.S. Pawn   Latin America Pawn   Other Investments   Total Segments   Corporate Items   Consolidated
                       
Revenues:                      
Merchandise sales $ 108,740     $ 43,767     $     $ 152,507     $     $ 152,507  
Jewelry scrapping sales   9,814       3,011             12,825             12,825  
Pawn service charges   69,945       23,085             93,030             93,030  
Other revenues   32       19       10       61             61  
Total revenues   188,531       69,882       10       258,423             258,423  
Merchandise cost of goods sold   67,643       29,696             97,339             97,339  
Jewelry scrapping cost of goods sold   8,550       3,352             11,902             11,902  
Gross profit   112,338       36,834       10       149,182             149,182  
Segment and corporate expenses (income):                      
Store expenses   71,946       29,323             101,269             101,269  
General and administrative                           15,609       15,609  
Depreciation and amortization   2,560       2,332             4,892       3,071       7,963  
Loss (gain) on sale or disposal of assets   81       (8 )           73             73  
Other income         (2,465 )           (2,465 )           (2,465 )
Interest expense                           3,390       3,390  
Interest income   (1 )     (298 )           (299 )     (1,599 )     (1,898 )
Equity in net loss of unconsolidated affiliates               32,501       32,501             32,501  
Other (income) expense         (46 )     6       (40 )     120       80  
Segment contribution (loss) $ 37,752     $ 7,996     $ (32,497 )   $ 13,251          
Income (loss) before income taxes             $ 13,251     $ (20,591 )   $ (7,340 )
                       

 

  Six Months Ended March 31, 2024
(Unaudited)
(in thousands) U.S. Pawn   Latin America Pawn   Other Investments   Total Segments   Corporate Items   Consolidated
                       
Revenues:                      
Merchandise sales $ 240,362     $ 103,728     $     $ 344,090     $     $ 344,090  
Jewelry scrapping sales   25,501       2,295             27,796             27,796  
Pawn service charges   159,083       54,529             213,612             213,612  
Other revenues   66       31       35       132             132  
Total revenues   425,012       160,583       35       585,630             585,630  
Merchandise cost of goods sold   151,507       69,962             221,469             221,469  
Jewelry scrapping cost of goods sold   22,078       1,918             23,996             23,996  
Gross profit   251,427       88,703       35       340,165             340,165  
Segment and corporate expenses (income):                      
Store expenses   158,095       67,042             225,137             225,137  
General and administrative                           34,809       34,809  
Depreciation and amortization   5,140       4,731             9,871       6,913       16,784  
(Gain) loss on sale or disposal of assets and other   (4 )     (262 )           (266 )     97       (169 )
Other income                           (765 )     (765 )
Interest expense                           6,842       6,842  
Interest income         (1,028 )     (1,206 )     (2,234 )     (3,287 )     (5,521 )
Equity in net loss of unconsolidated affiliates               (2,872 )     (2,872 )           (2,872 )
Other (income) expense         (47 )     15       (32 )     (404 )     (436 )
Segment contribution   88,196       18,267     $ 4,098     $ 110,561          
Income (loss) before income taxes             $ 110,561     $ (44,205 )   $ 66,356  

 

  Six Months Ended March 31, 2023
(Unaudited)
(in thousands) U.S. Pawn   Latin America Pawn   Other Investments   Total Segments   Corporate Items   Consolidated
                       
Revenues:                      
Merchandise sales $ 227,054     $ 89,240     $     $ 316,294     $     $ 316,294  
Jewelry scrapping sales   16,990       3,719             20,709             20,709  
Pawn service charges   139,255       46,368             185,623             185,623  
Other revenues   57       35       32       124             124  
Total revenues   383,356       139,362       32       522,750             522,750  
Merchandise cost of goods sold   140,899       61,317             202,216             202,216  
Jewelry scrapping cost of goods sold   14,766       4,089             18,855             18,855  
Gross profit   227,691       73,956       32       301,679             301,679  
Segment and corporate expenses (income):                      
Store expenses   145,250       56,822             202,072             202,072  
General and administrative         (3 )           (3 )     31,088       31,085  
Depreciation and amortization   5,315       4,547             9,862       6,089       15,951  
Loss (gain) on sale or disposal of assets   84       (27 )           57             57  
Other income         (2,465 )           (2,465 )           (2,465 )
Interest expense                           9,580       9,580  
Interest income   (1 )     (467 )           (468 )     (2,094 )     (2,562 )
Equity in net loss of unconsolidated affiliates               30,917       30,917             30,917  
Other expense (income)         24       10       34       (188 )     (154 )
Segment contribution (loss) $ 77,043     $ 15,525     $ (30,895 )   $ 61,673          
Income (loss) before income taxes             $ 61,673     $ (44,475 )   $ 17,198  

EZCORP, Inc.
STORE COUNT ACTIVITY
(Unaudited)

  Three Months Ended March 31, 2024
  U.S. Pawn   Latin America Pawn   Consolidated
           
As of December 31, 2023 530     707     1,237  
New locations opened     9     9  
Locations acquired 6         6  
Locations combined or closed (1 )   (5 )   (6 )
As of March 31, 2024 535     711     1,246  

 

  Three Months Ended March 31, 2023
  U.S. Pawn   Latin America Pawn   Consolidated
           
As of December 31, 2022 525   661   1,186
New locations opened 2   11   13
As of March 31, 2023 527   672   1,199

 

  Six Months Ended March 31, 2024
  U.S. Pawn   Latin America Pawn   Consolidated
           
As of September 30, 2023 529     702     1,231  
New locations opened     14     14  
Locations acquired 7         7  
Locations combined or closed (1 )   (5 )   (6 )
As of March 31, 2024 535     711     1,246  

 

  Six Months Ended March 31, 2023
  U.S. Pawn   Latin America Pawn   Consolidated
           
As of September 30, 2022 515   660     1,175  
New locations opened 2   13     15  
Locations acquired 10       10  
Locations combined or closed   (1 )   (1 )
As of March 31, 2023 527   672     1,199  

Non-GAAP Financial Information (Unaudited)

In addition to the financial information prepared in conformity with accounting U.S. generally accepted accounting principles (“GAAP”), we provide certain other non-GAAP financial information on a constant currency (“constant currency”) and adjusted basis. We use constant currency results to evaluate our Latin America Pawn operations, which are denominated primarily in Mexican pesos, Guatemalan quetzales and other Latin American currencies. We believe that presentation of constant currency and adjusted results is meaningful and useful in understanding the activities and business metrics of our operations and reflect an additional way of viewing aspects of our business that, when viewed with GAAP results, provide a more complete understanding of factors and trends affecting our business. We provide non-GAAP financial information for informational purposes and to enhance understanding of our GAAP consolidated financial statements. We use this non-GAAP financial information primarily to evaluate and compare operating results across accounting periods.

Readers should consider the information in addition to, but not instead of or superior to, our financial statements prepared in accordance with GAAP. This non-GAAP financial information may be determined or calculated differently by other companies, limiting the usefulness of those measures for comparative purposes.

Constant currency results reported herein are calculated by translating consolidated balance sheet and consolidated statement of operations items denominated in local currency to U.S. dollars using the exchange rate from the prior-year comparable period, as opposed to the current period, in order to exclude the effects of foreign currency rate fluctuations. In addition, we have an equity method investment that is denominated in Australian dollars and is translated into U.S. dollars. We used the end-of-period rate for balance sheet items and the average closing daily exchange rate on a monthly basis during the appropriate period for statement of operations items. The end-of-period and approximate average exchange rates for each applicable currency as compared to U.S. dollars as of and for the three and six months ended March 31, 2024 and 2023 were as follows:

    March 31,   Three Months Ended
March 31,
  Six Months Ended
March 31,
    2024   2023   2024   2023   2024   2023
                         
Mexican peso   16.6   18.1   17.0   18.7   17.3   19.2
Guatemalan quetzal   7.6   7.6   7.6   7.6   7.6   7.6
Honduran lempira   24.4   24.4   24.4   24.3   24.4   24.3
Australian dollar   1.5   1.5   1.5   1.5   1.5   1.5

Our statement of operations constant currency results reflect the monthly exchange rate fluctuations and so are not directly calculable from the above rates. Constant currency results, where presented, also exclude the foreign currency gain or loss.

Miscellaneous Non-GAAP Financial Measures

  Three Months Ended
March 31,
(in millions)   2024       2023  
       
Net income (loss) $ 21.5     $ (6.8 )
Interest expense   3.4       3.4  
Interest income   (2.9 )     (1.9 )
Income tax expense (benefit)   7.2       (0.6 )
Depreciation and amortization   8.2       8.0  
EBITDA $ 37.4     $ 2.1  

 

  Total Revenues   Gross Profit   Income Before Tax   Tax Effect   Net Income   Diluted EPS   EBITDA
                           
2024 Q2 Reported $ 285.6     $ 167.6     $ 28.7     $ 7.2     $ 21.5     $ 0.29     $ 37.4  
Corporate lease termination               (0.8 )     (0.2 )     (0.6 )     (0.01 )     (0.8 )
FX Impact               0.1             0.1             0.1  
Constant Currency and other impact   (5.4 )     (3.0 )     (0.4 )     (0.1 )     (0.3 )           (0.5 )
2024 Q2 Adjusted $ 280.2     $ 164.6     $ 27.6     $ 6.9     $ 20.7     $ 0.28     $ 36.2  

 

  Total Revenues   Gross Profit   Income Before Tax   Tax Effect   Net Income   Diluted EPS   EBITDA
                           
2023 Q2 Reported $ 258.4   $ 149.2   $ (7.3 )   $ (0.5 )   $ (6.8 )   $ (0.12 )   $ 2.1  
CCV Impairment and discrete adjustments           34.0       8.4       25.6       0.29       34.0  
Contingent consideration liability           (2.4 )     (0.7 )     (1.7 )     (0.02 )     (2.4 )
Impact of dilutive instruments*                             0.08        
2023 Q2 Adjusted $ 258.4   $ 149.2   $ 24.3     $ 7.2     $ 17.1     $ 0.23     $ 33.8  

 

  Three Months Ended
March 31, 2024
  Six Months Ended
March 31, 2024
(in millions) U.S. Dollar Amount   Percentage Change YOY   U.S. Dollar Amount   Percentage Change YOY
               
Consolidated revenues $ 285.6     11 %   $ 585.6     12 %
Currency exchange rate fluctuations   (5.4 )         (12.6 )    
Constant currency consolidated revenues $ 280.2     8 %   $ 573.0     10 %
               
Consolidated gross profit $ 167.6     12 %   $ 340.2     13 %
Currency exchange rate fluctuations   (3.0 )         (6.8 )    
Constant currency consolidated gross profit $ 164.6     10 %   $ 333.4     11 %
               
Consolidated net inventory $ 163.4     9 %   $ 163.4     9 %
Currency exchange rate fluctuations   (2.8 )         (2.8 )    
Constant currency consolidated net inventory $ 160.6     7 %   $ 160.6     7 %
               
Latin America Pawn gross profit $ 43.6     18 %   $ 88.7     20 %
Currency exchange rate fluctuations   (3.0 )         (6.8 )    
Constant currency Latin America Pawn gross profit $ 40.6     10 %   $ 81.9     11 %
               
Latin America Pawn PLO $ 62.0     26 %   $ 62.0     26 %
Currency exchange rate fluctuations   (3.7 )         (3.7 )    
Constant currency Latin America Pawn PLO $ 58.3     19 %   $ 58.3     19 %
               
Latin America Pawn PSC revenues $ 27.2     18 %   $ 54.5     18 %
Currency exchange rate fluctuations   (1.8 )         (3.9 )    
Constant currency Latin America Pawn PSC revenues $ 25.4     10 %   $ 50.6     9 %
               
Latin America Pawn merchandise sales $ 49.8     14 %   $ 103.7     16 %
Currency exchange rate fluctuations   (3.6 )         (8.5 )    
Constant currency Latin America Pawn merchandise sales $ 46.2     6 %   $ 95.2     7 %
               
Latin America Pawn segment profit before tax $ 8.1     2 %   $ 18.3     18 %
Currency exchange rate fluctuations   (0.4 )         (1.1 )    
Constant currency Latin America Pawn segment profit before tax $ 7.7     (4)        %   $ 17.1     10 %

 

Note: Percentages are calculated from the underlying numbers in thousands and, as a result, may not agree to the percentages calculated from numbers in millions.
1“Adjusted” basis, which is a non-GAAP measure, excludes certain items. “Constant currency” basis, which is a non-GAAP measure, excludes the impact of foreign currency exchange rate fluctuations. For additional information about these calculations, as well as a reconciliation to the most comparable GAAP financial measures, see “Non-GAAP Financial Information” at the end of this release.

2“Same Store” basis, which is a financial measure, includes stores open the entirety of the comparable periods.